I’m backing G20 goals, says Obama in boost for Brown

Barack Obama has backed Gordon Brown's call for an international spending plan to lift the world out of recession.

The US President also supported the Prime Minister's call for new banking regulations to be agreed at next month's summit in London.

"We've got two goals in the G20," Mr Obama said. "The first is to make sure there is concerted action around the globe to jumpstart the economy. The second is to make sure we are moving forward on a regulatory reform agenda."

His intervention was a huge boost to Mr Brown who had earlier been battling to ease concerns that the London summit would fail to make a breakthrough.

Chancellor Alistair Darling said this afternoon that countries around the world must admit they needed to work together to beat the slump.

"In our globalised economy a pound spent in Beijing or Bremen is a job saved in Bradford or Birmingham," he said. Mr Darling denied that the Government had problems dealing with the Obama administration, contradicting Cabinet Secretary Gus O'Donnell who this week said: "There is nobody there. You cannot believe how difficult it is."

Gordon Brown was forced to defend the summit today after doubts about what it will achieve to beat the recession.

A business leader complained Mr Brown was focusing on "totally irrelevant" issues, such as bankers' bonuses and tax havens, and a government minister warned it could be a "disaster". Martin Broughton, CBI president and chairman of British Airways, said free trade and a big economic stimulus should be the main target.

But Downing Street rejected the criticism, saying the G20 summit on 2 April would have a very wide-ranging agenda.

No 10 also defended the costs of staging the summit, revealed in yesterday's Evening Standard to be £19 million.

The sum is less than a quarter of the £80 million spent by Tony Blair on the 2005 Gleneagles summit and a fraction of the £205 million spent by Japan on last year's G8. "That cost reflects the general approach which is to keep the summit modest and businesslike, and to focus on the issues," said the No 10 spokesman. He admitted there were "different views" among world leaders about free trade, but said the issue would be fully aired to get the best agreement.

But Lord Malloch-Brown, a Foreign Office minister, warned expectations were so high a summit failure would be a disastrous. He said: "If we get anodyne conclusions with all the substance taken out of them, the markets on 3 April will be something of a disaster zone."Gordon Brown was forced to defend the much-vaunted G20 London summit today amid doubts about what it will achieve to beat the recession.

A business leader complained the Prime Minister was focusing on "totally irrelevant" issues, such as bankers' bonuses and tax havens, and a government minister warned it could be a "disaster".

Martin Broughton, CBI president and chairman of British Airways, said free trade and a big economic stimulus should be the main target.

But Downing Street rejected the criticism, saying the G20 summit on 2 April would rightly have a very wide-ranging agenda: "It is also important that as we assess the global regulatory system, we look at the culture in the banks — and central to that is their remuneration system."

No 10 also defended the costs of staging the summit, revealed in yesterday's Evening Standard to be £19 million.

The sum is less than a quarter of the £80 million spent by Tony Blair on the 2005 Gleneagles summit and a fraction of the staggering £205 million spent by Japan on last year's G8.

"That cost reflects the general approach which is to keep the summit modest and businesslike, and to focus on the issues," said the No 10 spokesman. He admitted there were "different views" among world leaders about free trade, but said the issue would be fully aired to get the best agreement.

Mr Broughton told the Financial Times it would be "nothing short of a catastrophe" to get "bogged down" in the wrong issues when there was a chance to make a difference. Averting protectionist policies and cutting employment costs were the correct priority, he said.

The businessman also pointed out that global leaders promised to champion free trade at November's Washington G20 meeting but some imposed import controls anyway.

Lord Malloch-Brown, a Foreign Office minister involved in preparations, warned that expectations were so high a summit failure would be a "disaster".

"If we get anodyne conclusions with all the substance taken out of them, the markets on 3 April will be something of a disaster zone, I have no doubt," he said.

Mr Brown has invested a lot of political capital in the G20 at which he hopes world leaders, including Barack Obama, will agree to spend their way out of recession.

So keen is the Government to ensure it gets attention, taxpayers will fund the cost of TV coverage and a ferry service across the Royal Docks for journalists.